SOME aspects of the Petroleum Industry Bill (PIB), which was passed by both upper and lower chambers of the National Assembly last week, are already generating concerns, even as Nigerians await the harmonised version of the bill to be sent to President Muhammadu Buhari for assent.
Both chambers of the National Assembly had passed the bill last week, but some industry analysts say the proposed bill is riddled with controversies that could create problems for Nigerians.
For instance, the Senate set aside 30 per cent of profits accruing from oil and gas operations by the Nigerian National Petroleum Corporation (NNPC) for exploration of oil in the frontier basins.
According to the proposed law, all the exploration of frontier basins would fall under the purview of the Upstream Regulatory Commission. Similarly, three per cent has been reserved for the development of host communities by the Senate as against five per cent earlier proposed.
The House of Representatives, on the other hand, reserved five per cent in the proposed bill, throwing up several issues that must be harmonised by the conference committee before final submission to the president.
“We should also try not to be sentimental about the 30 per cent set aside for the frontier basin from NNPC profit. We should also be more worried that such huge amount is not targeted towards clean and renewable energy since that is where the world is moving towards now,”a former member of the Nigerian Extractive and Transparency Initiative (NEITI) Faith Nwadishi told The ICIR.
She explained that since the proposed bill was not specific about the particular part of the country categorised as frontier region, state governors in the country, who had been engaging in oil search, could engage the National Assembly and seek the possibility of tapping into such funds for exploration when the bill got presidential assent.
“Cross River, Anambra, Benue Trough can explore this opportunity since it does not state any particular part of the country defined as a frontier basin,” she said.
However, some analysts say the bill will make Nigeria a competitive player in the oil market, arguing that every cloud has a silver lining.
Professor of Energy Economics at the University of Ibadan Adeola Adenikinju told The ICIR that Nigerians should beware of throwing away the baby with the bath water with their definition of what the frontier basin was.
He said that the bill, which had been in the works for over 13 years now, when signed into law, would help Nigeria have a national oil company that would compete with Saudi’s Aramco and other national oil companies that were already doing well globally.
“The bigger picture is that it is going to remove regulatory and fiscal uncertainties. We should not let the desire for what is perfect take us away from where we are currently,” he said.
He further called on the minister of state for petroleum resources and the group managing director of the NNPC to brief the nation on some controversial areas like the 30 per cent frontier development fund in order to clear the uncertainties characterising the bill.
It would be noted that a conference committee comprising the upper and lower arms of the National Assembly would harmonise the various positions of the bill before sending it to the president for assent.
There is a need for the National Assembly to have a bill that represents the yearnings of Nigeria and promote investments into the Nigerian most important resource -the oil and gas sector, analysts say.
“We need a bill that works for all Nigerians and delivers maximum profit and dividends for Nigeria’s oil and gas sector,”Executive Director of the African Centre for Leadership, Strategy and Development Monday Osasah told The ICIR